3M (MMM) shareholders can expect continued growth throughout 2016, the global manufacturer said at its Tuesday investors' day, rolling out a comprehensive five-year plan.
The primary objectives that CEO Inge Thulin offered at the conference include projections of 8% to 11% growth in earnings per share through 2020; 2% to 5% organic growth based on local currency sales; 20% return on invested capital; and robust free cash flow to help pay down 3M's roughly $11 billion in total debt.
"These objectives reflect our confidence in driving efficient growth -- that is, strong, sustainable growth and premium returns -- well into the future," Thulin said in a release. "Going forward, we remain focused on controlling the controllable, investing for the long term, and leveraging our scientific capabilities to create even greater value for our customers and shareholders."
3M also will be opening a 3M Carlton Science Center that will employ about 700 scientists to help build collaboration across its businesses. The company expects EPS for 2016 to clock in at roughly $8.10 to $8.45 and organic local currency sales to grow between 1% and 3%.
One market 3M is targeting in particular is China, according to Hak Cheoi Shin, 3M's vice president of international operations.
"We must win in Asia-Pacific, including China," he said, emphasizing that the manufacturer's healthcare department may stand to reap the most gains. "We love healthcare. Thats the fastest growing [segment] and most profitable in international."
Shin's objective is to tap into so-called Tier-B hospitals in China, a underutilized means of building out 3M's product base, and he estimates the manufacturer can grow its healthcare by 8% to 9% on an annualized basis.
3M's $5.4 billion in net healthcare revenue last year made up about 18% of the company's total net sales, while its industrial segment is roughly twice the size, leading 3M's operations with $10.3 billion in 2015 sales.