Supplemental Equity and Comprehensive Income Information

3 Months Ended

Mar. 31, 2012

Supplemental Equity and Comprehensive Income Information

Supplemental Equity and Comprehensive Income Information

NOTE 4.  Supplemental Equity and Comprehensive Income Information

Consolidated Statement of Changes in Equity

Three months ended March 31, 2012				3M Company Shareholders
(Millions)	Total			Common Stock and Additional Paid-in Capital		Retained Earnings			Treasury Stock			Accumulated Other Comprehen- sive Income (Loss)			Non- controlling Interest
Balance at December 31, 2011	$	15,862		$	3,776	$	28,348		$	(11,679	)	$	(5,025	)	$	442
Net income	1,141					1,125									16
Other comprehensive income (loss), net of tax:
Cumulative translation adjustment	134											155			(21		)
Defined benefit pension and post-retirement plans adjustment	97											97			—
Debt and equity securities - unrealized gain (loss)	3											3			—
Cash flow hedging instruments - unrealized gain (loss)	(15		)									(15		)	—
Total other comprehensive income (loss), net of tax	219
Dividends paid	(410		)			(410		)
Stock-based compensation, net of tax impacts	127			127
Reacquired stock	(534		)						(534		)
Issuances pursuant to stock option and benefit plans	214					(205		)	419
Balance at March 31, 2012	$	16,619		$	3,903	$	28,858		$	(11,794	)	$	(4,785	)	$	437
Three months ended March 31, 2011				3M Company Shareholders
(Millions)	Total			Common Stock and Additional Paid-in Capital		Retained Earnings			Treasury Stock			Accumulated Other Comprehen- sive Income (Loss)			Non- controlling Interest
Balance at December 31, 2010	$	16,017		$	3,477	$	25,995		$	(10,266	)	$	(3,543	)	$	354
Net income	1,103					1,081									22
Other comprehensive income (loss), net of tax:
Cumulative translation adjustment	242											248			(6		)
Defined benefit pension and post-retirement plans adjustment	76											76			—
Debt and equity securities - unrealized gain (loss)	(1		)									(1		)	—
Cash flow hedging instruments - unrealized gain (loss)	(17		)									(17		)	—
Total other comprehensive income (loss), net of tax	300
Dividends paid	(392		)			(392		)
Business combination allocation to noncontrolling interest	56														56
Purchase and sale of subsidiary shares - net	(33		)												(33		)
Stock-based compensation, net of tax impacts	131			131
Reacquired stock	(675		)						(675		)
Issuances pursuant to stock option and benefit plans	380					(163		)	543
Balance at March 31, 2011	$	16,887		$	3,608	$	26,521		$	(10,398	)	$	(3,237	)	$	393

Accumulated Other Comprehensive Income (Loss) Attributable to 3M

	March 31,			December 31,
(Millions)	2012			2011
Cumulative translation adjustment	$	269		$	114
Defined benefit pension and postretirement plans adjustment	(5,058		)	(5,155		)
Debt and equity securities, unrealized gain (loss)	(3		)	(6		)
Cash flow hedging instruments, unrealized gain (loss)	7			22
Total accumulated other comprehensive income (loss)	$	(4,785	)	$	(5,025	)

Components of Comprehensive Income (Loss) Attributable to 3M

	Three months ended
	March 31,
(Millions)	2012			2011
Net income attributable to 3M	$	1,125		$	1,081
Cumulative translation	155			221
Tax effect	—			27
Cumulative translation - net of tax	155			248
Defined benefit pension and postretirement plans adjustment	153			119
Tax effect	(56		)	(43		)
Defined benefit pension and postretirement plans adjustment - net of tax	97			76
Debt and equity securities, unrealized gain (loss)	5			(2		)
Tax effect	(2		)	1
Debt and equity securities, unrealized gain (loss) - net of tax	3			(1		)
Cash flow hedging instruments, unrealized gain (loss)	(24		)	(27		)
Tax effect	9			10
Cash flow hedging instruments unrealized gain (loss) - net of tax	(15		)	(17		)
Total comprehensive income (loss) attributable to 3M	$	1,365		$	1,387

Reclassification adjustments are made to avoid double counting in comprehensive income items that are also recorded as part of net income. Reclassifications to earnings from accumulated other comprehensive income including noncontrolling interest that related to pension and postretirement expense in the income statement were $153 million pre-tax ($97 million after-tax) for the three months ended March 31, 2012 and $119 million pre-tax ($76 million after-tax) for the three months ended March 31, 2011. These pension and postretirement expense pre-tax amounts are shown in the table in Note 7 as amortization of transition (asset) obligation, amortization of prior service cost (benefit) and amortization of net actuarial (gain) loss. Cash flow hedging instruments reclassifications are provided in Note 8. Reclassifications to earnings from accumulated other comprehensive income that related to realized losses due to sales or impairments (net of realized gains) for debt and equity securities were $1 million pre-tax ($1 million after-tax) for the three months ended March 31, 2012 and not material for the three months ended March 31, 2011. Other reclassification adjustments were not material. Income taxes are not provided for foreign translation relating to permanent investments in international subsidiaries, but tax effects within cumulative translation does include impacts from items such as net investment hedge transactions.

Purchase of Subsidiary Shares and Transfers of Ownership Interests Involving Non-Wholly Owned Subsidiaries

As discussed in Note 2 in 3M’s 2011 Annual Report on Form 10-K, in early March 2011, 3M acquired a controlling interest in Winterthur Technologie AG (Winterthur), making Winterthur a consolidated subsidiary as of this business acquisition date. As of this business acquisition date, noncontrolling interest related to Winterthur totaled $56 million. Subsequent to this business acquisition date, 3M purchased additional outstanding shares of its Winterthur subsidiary increasing 3M’s ownership interest from approximately 86 percent as of the business acquisition date to approximately 94 percent as of March 31, 2011, and subsequently to 100 percent as of December 31, 2011. The $33 million of cash paid in the first quarter of 2011 as a result of these additional purchases of Winterthur shares was classified as other financing activity in the consolidated statement of cash flows. These additional purchases did not result in a material transfer from noncontrolling interest to 3M Company shareholders’ equity.